NEWS: The real picture – repealing liquid fuel taxes means no future road improvements
June 5, 2018
Hagåtña — The recent passage of the Liquid Fuel Tax will help repave some of the worst traversed village roads on Guam, or in some cases, roads like Gil Breeze in Dededo get paved for the very first time.
In the last few years, as roads have been improved, residents and business owners along those roads have said there is less damage to their cars, better road conditions, and businesses are seeing more customers.
“Having the new road has brought us new customers,” stated Youn Pangelinan, Chamorro BBQ owner.
Juvy Sahagon, an employee at R Daily Mart, said “the road is much better for our customers, they don’t have to go all the way around anymore, and they come straight through here.”
The liquid fuel tax provides an identified and dedicated funding source to pay for maintaining village roads that will allow for more village roads to be fixed. DPW’s village road list is comprised of priorities identified by both DPW and the island’s mayors. Without a dedicated funding source – the department’s 20 year, $70 million dollar Village Streets Master Plan which includes roads like “Ping Pago” in Chalan Pago, “Pick A Nail” in Tamuning, or “Swamp Road” in Dededo – will become dormant and roads will continue to deteriorate.
The Guam Highway Funds, over the years, has been allocated by senators for things other than roads. Village roads have to be maintained using local funds as federal highway funds can only be used for routed roads. The Department of Public Works has said that without the funding, projects that people have seen in the last few roads will not be maintained – these have been funded by a mix of local funds and redirected federal funds. In total, DPW estimates 860 miles of village roads need to be repaved.
“As end users, Guam’s taxpayers can see the impact … and enjoy the benefits of these roads,” said DPW Director Glenn Leon Guerrero, during a public hearing on Bill 270 which would repeal the liquid fuel tax. “All I wanted was money on a regular basis so that we can continue paving village roads and making them safe for our people.”
Some have noted that the liquid fuel tax increased the cost of gas on Guam. The liquid fuel tax was established more than 30 years ago when gas cost about $3 per gallon. In 1999, that cost was about $1.64. In 2007, gas was $3.17 a gallon. We submit that forces outside of the liquid fuel tax has had a greater increase of tax.
The practice of continuing to mislead the public with falsehoods that are haphazardly used in order to paint an erroneous picture, is irresponsible and halts progress.
Case in point:
During the hearing, a citizen reiterated misleading information, saying that the government added $6 million to its personnel. This is false.
The government has reduced personnel numbers over the years. And within this fiscal year, personnel costs were lowered from $4.2 million to $3.9 million.
Another falsehood presented to Senators that $200 million was not collected in taxes: This is false.
Post reconciliation process, the Department of Revenue and Taxation has identified $160 million dollars in outstanding accounts. DRT is aggressively pursuing $105 million in taxes through tax collection efforts and programs (like the ongoing tax amnesty). Additionally, the Fiscal Strike Team is working to strengthen tax collections in those areas of weakness. The remaining $50 million or so is in some sort of litigation or payment arrangement:
Bankruptcy: $9.1M (monies are held until the court says otherwise)
Inactive: $85,971 (taxpayers can’t be located)
Litigation: $29.8M (pending court decisions)
Offer-in-compromise: $5.2M (taxpayer is negotiating due to hardship)
Payment Arrangement: $9.5M (taxpayer is agreeing to pay taxes owed in installments)

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